THE writing could be on the wall for staff at publishing giants Penguin and Random House with a massive £2.5billion merger.

Bosses refused to rule out job losses among the combined group’s 8,800 strong workforce after the tie-up was announced yesterday.

Marjorie Scardino, chief executive of Penguin owner Pearson, said the two firms could “share a large part of their costs”.

The new venture will be called Penguin Random House.

Pearson will have a 47% stake with Random House’s German owner Bertelsmann holding the rest.

The deal still requires regulatory clearance and is not expected to complete until the second half of next year.

There is also the possibility a rival party may derail the partnership with News Corporation, owners of HarperCollins, ­reportedly interested in making a £1bn offer for Penguin.

The combined company will bring together Fifty Shades of Grey writer EL James with the likes of Penguin’s classical authors such as Charles Dickens and Jane Austen. Penguin employs around 950 people in the UK.